Tag Archives: Qatar

Recently several Gulf nations, including Saudi Arabia, have severed connections with Qatar; they claim the country is destabilizing the region with its support for extremist groups. Though the United States has interests in the country of Qatar, President Trump has expressed his support for the boycotting of Qatar by the Gulf Nations, claiming “…perhaps this will be the beginning of the end to the horror of terrorism!”

If President Trump followed Saudi Arabia’s lead and pushed to label Qatar as a state sponsor of terrorism, what would this mean for public companies? What industries would most be affected?

Currently, the Department of State has labeled three different countries as state sponsors of terrorism: Sudan, Syria, and Iran. These countries are subject to U.S. economic sanctions and export controls.

The Securities and Exchange Commission ensures that public companies are depicting the nature and extent of any past, current, and anticipated contacts with these countries, whether through subsidiaries, affiliates, distributor, partners, joint venture partners or other direct or indirect arrangements in their SEC filings.

MyLogIQ studied trends in SEC Comment Letters relating states labeled as sponsors of terrorism and found the following data:

The top 10 industries who received SEC Comment Letters relating to countries designated as sponsors of terrorism and the number of companies for each industry are:

MyLogIQ also studied SEC filings for mentions of Qatar. The top 10 industries who have disclosed relationships or possible associations with Qatar are shown below.

SEC Comment Letter Disclosures:

Company: Delta Airlines Inc/DE/

SEC Comment Letter Disclosure: Please discuss the materiality of any contacts with Sudan and Syria you describe in response to the comment above, and whether the contacts constitute a material investment risk for your security holders.

Company Response: Deltas total revenues for 2014, 2015, 2016 and the first three months of 2017 were $40.4 billion, $40.7 billion, $39.6 billion, and $9.1 billion, respectively. As discussed in the response to comment 1 above, Delta did not operate flights to or from either Sudan or Syria during the referenced period nor did its subsidiaries or the companies in which Delta holds a minority investment operate in either of the two countries. The interline sales commission revenue Delta received from flights operated to or from Sudan (on carriers other than Sudanese carriers) did not exceed $3,000 per annum in any of the referenced period and did not exceed $2,000 per annum in two of the years in the referenced period. Delta had no revenue related to Syria in any of the years in the referenced period.

Company: Comcast Corp

SEC Comment Letter Disclosure: A press release on the NBCUniversal.com website dated January 13, 2016 states that NBCUniversal International signed a long-term deal with OSN, a pay-TV network in the Middle East and North Africa, granting OSN exclusive rights to NBCUniversal International content including the Syfy channel. The OSN.com website provides TV scheduling for its services in Sudan and Syria that include the Syfy channel and programming produced by Universal Pictures, an entity you identify on page 1 of the 10- K as included in your filmed entertainment business segment. Sudan and Syria are designated by the Department of State as state sponsors of terrorism, and are subject to U.S. economic sanctions and export controls. Please describe to us the nature and extent of any past, current, and anticipated contacts with Sudan and Syria, whether through subsidiaries, affiliates, distributors, partners, joint venture partners or other direct or indirect arrangements.

Company Response: NBCUniversal has not had any agreements and/or commercial arrangements with the governments of either Syria or Sudan during the last three fiscal years or the three months ended March 31, 2017 (the Relevant Time). NBCUniversal has had minimal contacts with Sudan and Syria during the Relevant Time as described below. We note that, although Sudan has not yet been removed from the list of state sponsors of terrorism, pursuant to a general license issued on January 17, 2017 by the U.S. Department of the Treasurys Office of Foreign Assets Control (OFAC), U.S. persons are currently generally permitted to transact with individuals and entities in Sudan. Further, Executive Order 13761, dated January 13, 2017, provides for the revocation of the sanctions provisions in prior Sudan-related Executive Orders on July 12, 2017, if the Government of Sudan sustains certain positive actions. We do not have business offices or ongoing operations located in Sudan or Syria. While our general approach is to exclude Sudan and Syria, as well as other countries subject to U.S. economic sanctions, from NBCUniversals distribution, programming, and licensing contracts, occasionally Sudan and/or Syria have been included within a larger territory covered in certain contractual arrangements in a manner consistent with OFAC regulations based on the application of guidance related to the general inventory rule and/or the informational materials exemption.

Company: Exar Corp

SEC Comment Letter Disclosure: We are aware of publicly available information indicating that you have significant business with ZTE Corporation, which is reported to have sold products into Sudan and Syria. Sudan and Syria are designated as state sponsors of terrorism by the State Department and are subject to U.S. economic sanctions and export controls. You do not include disclosure in the Form 10-K about contacts with Sudan and Syria. Please describe to us the nature and extent of any past, current and anticipated contacts with Sudan and Syria, whether through subsidiaries, original equipment manufacturers, distributors, customers or other direct or indirect arrangements.

Company Response: The Company has not entered into any agreements, arrangements or other contacts with Sudan or Syria and has no future plans to enter into any such agreements, arrangements or other contacts. Moreover, the Company does not maintain any offices or other facilities in Sudan or Syria, has no employees in either of those countries, and has no assets or liabilities associated with activities in either of those countries. The Company derives its revenue from the sale of semiconductors to distributors who then sell parts to their customers to integrate or incorporate into other products. The Companys distributors work with their customers to fulfill any orders that involve Company products. The Company receives a weekly resale report from its distributors so it can monitor its sell-through to its end customer. With respect to ZTE, which the Company considers its end customer, the Company does not directly sell any products to ZTE; all prior sales to ZTE have gone through the Companys distributors and consisted of sales of the Companys standard commodity products. In addition, the Company believes its standard terms and conditions of sale obligate its distributors and its end customers to strictly comply with United States export control laws and regulations.

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